Chapter 13.04
UTILITY LATECOMER AGREEMENTS
Sections:
13.04.020 Authorization – Minimum project size.
13.04.030 Application – Design standards – Cost estimates.
13.04.040 Length of utility latecomer agreements.
13.04.050 Public works director’s determination – Appeal.
13.04.060 Assessment reimbursement area and charge – Appeal.
13.04.070 Written agreement – Payment of city costs in excess of application fee.
13.04.080 Utility latecomer agreement must be recorded.
13.04.090 Construction and acceptance of improvements – Recording of final fees.
13.04.100 Ownership of improvements or systems – As-builts.
13.04.120 Implementation of utility latecomer agreement – Prepayment requirement.
13.04.130 Payments of utility latecomer charge – Notice of change of address required.
13.04.140 Rights and nonliability of city.
13.04.150 Director’s authority – Violations.
13.04.160 Existing latecomer agreements – Completed construction.
13.04.170 Alternative financing method.
13.04.010 Purpose – Intent.
A. Purpose. The purpose of this chapter is to define the rules and regulations for executing 20-year contracts between the city and developers for private construction of municipal water, sewer or storm drainage improvements by providing means for (1) partial cost recovery through a charge to later users who did not contribute to the capital costs and (2) the establishment of benefit areas defining which properties are subject to such charges. This chapter is also intended to implement Chapters 35.91, 35.92, and other provisions of the Revised Code of Washington, as it now reads, or is later amended.
B. Intent. It is intended that the processing of utility latecomer agreements under this chapter be independent from the regulatory reform time lines contained in PTMC Title 20. Further, nothing in this chapter shall be construed to create any city obligation to subsequently serve water to property within a reimbursement area if that property is removed from the city’s out-of-city water service area during the term of the latecomer agreement. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.020 Authorization – Minimum project size.
A. Any property owner whose property is located either (1) within the city who uses private funds to construct water, sewer, and/or storm drainage improvements to connect to existing city water, sewer, or storm drainage for the purpose of serving the area in which the real property of such owner is located, or (2) within 10 miles of the city’s corporate limits who uses private funds to construct water improvements to connect to the city’s out-of-city water service area, in order to serve the area in which the real property of such owner is located, may apply to the city to establish a utility latecomer agreement in order to recover a portion of the costs from subsequent users of the system(s).
B. To be eligible for a utility latecomer agreement, the estimated total cost of the water, sewer or storm drainage improvements must be at least $5,000 separately or $7,500 combined, to be adjusted annually in accordance with the Engineering News-Record Index (“ENR”). The determination of eligibility shall be made by the public works director, based upon bids, engineering or architecture estimates, or other information deemed by the director to be a reliable basis for estimating cost. The determination of the director shall be deemed final and conclusive. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.030 Application – Design standards – Cost estimates.
A. Application Form – Fee. The application must be on a form provided by the city and accompanied by a nonrefundable application fee in an amount as set forth by council resolution for each type of agreement.
B. In addition to the latecomer application, the applicant must meet all of the design and other applicable requirements of Chapters 13.11 through 13.14 PTMC for water, Chapters 13.21 through 13.23 PTMC for sewer and Chapters 13.31 and 13.32 PTMC for stormwater.
C. Engineering Design Standards Manual. Prior to the application being submitted, the city will apprise the applicant of the design standards and specifications for the sewer, water or storm drainage improvements which will be required for the proposed project, consistent with city ordinances and/or adopted design manuals, as identified by the applicable development review process for in-city applicants, or the out-of-city reservation process for out-of-city applicants. The procedures and requirements for installing utility improvements shall be as outlined in the engineering design standards manual.
D. Cost Estimate. The applicant must submit with the application a statement from a licensed contractor or engineer containing an itemized estimate of the total projected cost of the system improvements.
E. Additional Requirements. When deemed necessary in the discretion of the public works director to determine the benefit area and reimbursement charge, the city may require that the application be accompanied by any or all of the following:
1. A scaled vicinity drawing, stamped by a licensed civil engineer or licensed land surveyor, depicting the proposed improvements, their location and the proposed benefited area;
2. The name and mailing address of each owner of record of property within the proposed benefit area, together with the legal description, the size and the county assessor’s tax number for each property, such information to be certified as complete and accurate by the applicant;
3. A statement from a licensed contractor or professional engineer containing an itemized estimate of the total projected cost of the system improvements. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 3051 § 1 (Exh. A), 2010; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.040 Length of utility latecomer agreements.
The utility latecomer agreement shall be for a period of 20 years from the date the latecomer agreement is signed by both parties. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.050 Public works director’s determination – Appeal.
A. Approval of Application. The public works director shall review all applications and shall approve the application only if the following requirements are met:
1. The project satisfies the minimum cost requirement and complies with city design and construction standards and all applicable federal, state, and local laws, rules and regulations, including but not limited to the city of Port Townsend Municipal Code for water, sewer and stormwater and environmental laws;
2. The proposed improvements fall within the definition of water, sewer, and/or storm drainage improvements;
3. The proposed improvements are not constructed or currently under construction;
4. The proposed improvements are consistent with the city’s comprehensive plan, utility plan, and/or transportation plan; and
5. The city has the capability and the capacity to service the water, sewer, and/or storm drainage improvement.
B. Public Works Director’s Determination. In the event all of the above criteria are not satisfied, the public works director shall either condition approval as necessary in order for the application to conform to such criteria or deny the application. The final determination of the public works director shall be in writing.
C. Appeal. The final determination of the public works director is an administrative decision that may be appealed by an applicant. The appeal must be filed with the public works department within 20 calendar days of the date the final determination is mailed to the applicant. The procedures set forth in Chapter 1.14 PTMC shall apply to any appeal. The appeal must be accompanied by a filing fee in the amount set forth by council resolution. Any decision of the public works director not appealed from shall be final at the time made. In reviewing a final determination the hearing examiner shall apply the criteria set forth above, and shall uphold the administrative decision of the public works director, unless evidence clearly demonstrates that the criteria have been satisfied. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 3051 § 1 (Exh. A), 2010; Ord. 2805 § 1, 2002; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.060 Assessment reimbursement area and charge – Appeal.
A. Reimbursement Area Formula. The public works director shall formulate the benefit reimbursement area for all approved applications based upon the following:
1. The benefit reimbursement area shall be based upon a determination of which property owners did not contribute to the original costs of the improvement and whose parcels are located so that they are adjacent to the improvements, or are likely to require a service connection to the improvements based on city codes and standards; provided, however, that the public works director has the authority to remove from the benefit area those properties which are later developed but which do not subsequently tap into or use the water or sewer facilities. The applicant/property owner is not entitled to reimbursement for lots that are adjacent to the improvements if those lots are owned by the applicant/property owner at the time they apply for the utility latecomer agreement or at the time the utility improvements are constructed.
2. The estimated amount of the reimbursement charge shall be established so that each property will pay a fair, pro rata share of the cost of construction of the water, sewer, and/or storm drainage improvements, which is proportional to the benefits which accrue to the property, determined at the city’s sole discretion on an acre, front footage, equivalent water meter, or other equitable basis.
B. Notice to Property Owners. A notice containing the benefit reimbursement area boundaries, preliminary charges, and a description of the property owner’s rights to request a public hearing before the hearing examiner with regard to the area boundaries and special benefits and charge shall be forwarded by certified mail, return receipt requested, to the property owners within the proposed benefit reimbursement area. The city will maintain in its files a declaration of mailing.
C. Appeal/Request for Hearing.
1. Any appeal requesting a hearing pursuant to subsection B of this section must be filed within 20 calendar days of the date the notice is mailed to the property owners. The procedures set forth in Chapter 1.14 PTMC shall apply to any appeal. Notice of the hearing shall be given to all affected property owners. The appeal must be accompanied by a filing fee in the amount set forth by council resolution. Any decision of the public works director not appealed from shall be final at the time made. In reviewing a final determination, the city shall apply the criteria set forth above, and shall uphold the administrative decision of the public works director, unless evidence clearly demonstrates that the criteria have been satisfied.
2. After reviewing the public hearing testimony and the determination of the public works director, the hearing examiner may approve, modify or reject the benefit reimbursement area and/or charges. This determination shall be final.
3. Any judicial appeal of the hearing examiner’s determination must be filed and served within 21 days of the issuance of the decision. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 3051 § 1 (Exh. A), 2010; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.070 Written agreement – Payment of city costs in excess of application fee.
A. Upon approval of the application, formulation of a reimbursement area and charge, notice to the property owners and expiration of the appeal periods or a determination by the hearing examiner, the utility latecomer agreement, together with supporting documents, shall be presented to the city manager to sign the utility latecomer agreement on behalf of the city.
B. In the event costs incurred by the city for engineering or other professional consultant services required in processing the application exceed the amount of the application fee, the public works director shall so advise the city manager, and city manager approval may be conditioned upon receipt of payment by the applicant of an additional amount sufficient to compensate the city for its actual costs in excess of the application fee. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2816 § 1, 2002; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.080 Utility latecomer agreement must be recorded.
In order to become effective, a utility latecomer agreement must be recorded with the Jefferson County auditor. After the agreement has been signed by all parties, the city shall record the agreement, with a notice to title legally describing all properties within the benefit area, which shall constitute the notice required by RCW 65.08.170. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2609 § 2, 1997; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.090 Construction and acceptance of improvements – Recording of final fees.
A. After all necessary permits and approvals have been obtained, the applicant shall construct the improvements and, upon completion, request final inspection and acceptance of the improvements by the city, subject to any required obligation to repair defects. All construction, inspection and testing shall conform to other sections of this code and to the engineering design standards manual.
B. An appropriate bill of sale, easement and any other document needed to convey the improvements to the city and to ensure right of access for maintenance and replacement shall be provided, along with documentation of the actual costs of the improvements and a certification by the applicant that all of such costs have been paid. The total cost of the improvements must be submitted to the city within 120 days of completion of the improvements.
C. The final cost of the improvements shall be reviewed against the preliminary assessments established by the city and used by the city as a basis for determining reimbursement amounts. Upon a showing of good cause, the assessed charges shall be modified to include cost overruns up to a maximum of 10 percent. In the event that actual costs are less than the public works director’s estimate by 10 percent or more, the public works director shall recalculate the charges, reducing them accordingly. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.100 Ownership of improvements or systems – As-builts.
A. Upon approval of a utility latecomer agreement and the completion and acceptance of the construction, the improvement(s) and/or system(s) shall become the property of the city. The city may charge and receive fees for utility system use according to the city’s established rates. In the alternative, upon acceptance of construction, the city may require a private maintenance agreement.
B. A copy of the engineering “as-built” plans, specifications and drawings, including all necessary rights-of-way and easement documents, shall be provided to the city prior to acceptance of the water, sewer, or storm drainage facilities. As-built submittals shall comply with the requirements of the engineering design standards manual.
C. No connection to, or other use of, the facilities will be allowed or permitted until the city has officially accepted the construction.
D. Transfer of ownership to the city shall be clear of all encumbrances. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.110 Defective work.
The applicant shall be responsible for all work found to be defective within one year after the date of acceptance of the improvements by the city. Chapter 13.01 PTMC contains provisions for the public works director to require a performance bond for the improvements. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.120 Implementation of utility latecomer agreement – Prepayment requirement.
A. Upon recording, the utility latecomer agreement and charge shall be binding upon all property owners of record within the benefit area who were not parties to the contract. If an owner later develops his or her property within 20 years and is not required to install similar utility improvements because such improvements were already installed under the latecomer agreement, the city shall require that owner to reimburse the developer/owner who initially constructed the projects pursuant to the reimbursement share previously determined in the utility latecomer agreement.
B. Connection to or use of the system(s) by property owners within the benefit area shall be prohibited and development permission shall not be granted unless the city has received payment of the utility latecomer charge, including administrative costs. Unless modified in the agreement, the city shall add 10 percent, but not less than $20.00, to each utility latecomer charge, to be used by the city to defray the costs of labor, bookkeeping, and accounting necessary to administer the agreement, to be adjusted annually in accordance with ENR Index. No building permit shall be issued until reimbursement payment is made.
C. The utility latecomer charge shall be in addition to the usual and ordinary charges, including hook-up fees, system development charges, and any other fees which must be paid by persons applying for city water or sewer service, as required by city ordinances.
D. The city will exercise its best efforts to assure compliance with this section; however, in no event shall the city incur liability for an unauthorized connection to or use of the facilities.
E. Where any tap or connection is made into any water, sewer or storm drainage system(s) without payment being made as required by this chapter, the city may order the unauthorized tap or connection and all connecting pipe located in the city right-of-way removed without any liability to the city or city officials. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.130 Payments of utility latecomer charge – Notice of change of address required.
A. The city shall pay the amounts due the beneficiary within 60 calendar days of receipt, subject to subsection C of this section, by certified mail, return receipt requested.
B. When the utility latecomer fee for a particular parcel has been paid, at the request of the owner/payor, the city shall approve a release of lien, which may be recorded by the owner/payor at the owner/payor’s expense.
C. Every two years from the date the agreement is executed, the developer shall notify the city in writing of any change to his or her name(s), telephone number(s), or address(es). If the developer/property owner fails to comply with the notification requirements within 60 days of the specified time, the city may collect any reimbursement funds owed to the developer/property owner. The city is not responsible for locating any developer entitled to benefits under the utility latecomer agreement. The developer may not assign any rights under the utility latecomer agreement without written notification to the city. Absent such notification, any assignment of rights under the agreement shall have no effect on the obligations of the city under the latecomer agreement.
D. Any funds not claimed by the developer within 180 days from the date collected shall become the property of the city. Before the expiration of the 180 days, the city shall send to the developer, by certified mail, return receipt requested, a final notice of the city’s intent to deposit the funds as city revenue. If the city does not receive a response by the expiration of the 180 days, the funds shall be revenue to the city sewer, water or stormwater utility or as allowed by law. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.140 Rights and nonliability of city.
A. In accordance with Washington State law, the city reserves the right to refuse to enter into any utility latecomer agreement or to reject any application thereof.
B. All applicants for utility latecomer agreements shall be required to provide a written release, indemnification, and hold harmless agreement releasing and indemnifying the city from all claims of any nature, including property damage and personal injury arising out of the execution, establishment, enforcement and implementation of such agreement including claims arising during the course of construction and during the one-year warranty period following acceptance of the improvements by the city. Such indemnification shall include attorney fees and costs reasonably incurred in the defense of such action. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.150 Director’s authority – Violations.
A. Director’s Authority. Whenever the public works director or his or her designee (“director”) determines that a condition exists in violation of this chapter or any standard required to be adhered to by this chapter, or in violation of any permit issued hereunder, he or she is authorized to enforce the provisions of this chapter.
B. Chapter 1.20 PTMC Applicable. All violations of any provision of this chapter or incorporated standards, or of any permit or license issued hereunder, are declared nuisances and made subject to the administration and enforcement provisions of Chapter 1.20 PTMC, including any amendments, and including but not limited to abatement, criminal penalty, and civil penalty as set forth in Chapter 1.20 PTMC, which are incorporated by reference as if set forth herein. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2952 § 3, 2008; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.160 Existing latecomer agreements – Completed construction.
Nothing in this chapter shall be construed as changing or modifying any existing utility latecomer agreement between the city and a developer, which shall remain in full force and effect and subject to its terms. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997; Ord. 2515 § 1, 1996).
13.04.170 Alternative financing method.
As an alternative to financing projects under this chapter solely by owners of real estate, the city may join in the financing of these improvement projects and may be reimbursed in the same manner as the owners of real estate who participate in the projects; provided, that the city has specified the conditions of its participation in an ordinance. The city may be reimbursed only for the costs of the improvements that benefit the portion of the public who will use the developments within the established assessment reimbursement area. No city costs for improvements that benefit the general public shall be reimbursed. (Ord. 3274 § 1 (Exh. A), 2021; Ord. 2579 § 1, 1997).